Using third parties to acquire opt-in consumer data for your brands is a highly effective customer acquisition strategy. The key advantages to advertisers are the cost efficiency and targeting effectiveness, as many programs use performance-based pricing modes to reduce the advertiser’s cost risk; and the advertisers are able to use the consumer data already collected by the third party site to determine who to show their first party opt-in to. However, without full transparency into the third party consumer experience, it can be difficult to understand how to classify the data you receive; and how it fits within your existing database segments.
In order for a third party opt-in to classify as first party data for your brand, the consumer experience needs to have included a single action in which the consumer knowingly opts-in to receive information for your brand alone, much like they do on your first party properties. These experiences are common in acquisition marketing channels like co-registration and lead exchanges. However, in both of these channels, there is a troubling practice in which third party publishers rely on data aggregation to simple match consumers with advertisers. These publishers do so using a generic opt-in experience in which the consumer is not explicitly opting in to receive information from a single brand in a single action. Rather, these publishers use an all-encompassing opt-in action to get consumers to consent to receive information from their marketing partners and then match consumers with the marketing partners they feel are the best fit based on data analysis. While the consumer knowingly consents to be contacted by marketing partners in this example, they do not necessarily explicitly know which of these marketing partners or how many will receive their information. Additionally, the advertisers receiving consumer data are unaware that the consumers did not actively opt-in to an ad from their brand.
Shared leads, list rentals, data appends have long been effective parts of advertisers’ marketing mixes. As long as the advertiser and consumer are both aware of what consumer information is being provided to which advertiser(s) and how that information is going to be used, transparency is provided. Likewise, third party data has general in the digital marketing ecosystem. It is the lifeblood of highly successful programmatic, retargeting and social media campaigns. But when it comes to consent based outbound marketing channels like email and SMS, it is imperative that advertisers fully understand how consumers are opting in to receive your marketing messages; especially given the strict guidelines laid out in regulations like CANSPAM, TCPA and CASL.
How can you be more vigilant?
- Ask your third parties to show you a live consumer experience on their site to ensure the consumer is completing the action you expect.
- Require your third parties to implement an independent authentication technology to verify ever consumer action. TrustedFrom, from ActiveProspect, is a great technology to complete this task.
- Use an agency with experience managing third party data collectors to manage and audit your vendors on your behalf.
At DMi Partners, your best interests are our best interests. Let’s talk about how we can help. For 15 years, DMi has been managing email marketing, strategy and acquisition programs for leading consumer brands.